Japan Pursuing Australia's Natural Gas Resources
From Istock Analyst
For the past three years, Australia has hosted a thrilling race to develop its coal seam gas resources. BG Group is the current market leader, with other IOC/NOC joint ventures close behind; Shell made the most recent move, offering to acquire the remaining shares of its partner Arrow Energy. Yet, with competition continuing apace, Japan”s strategic purchases have been largely overlooked.
Japan is the largest user of liquefied natural gas (LNG) in the world. In 2009, Tokyo Electric Power Co. consumed 12% more LNG than the previous year; with power consumption only growing 7% in the same period, it is clear that LNG is gaining increasing importance. Australia”s coal seam gas (CSG) is particularly known for its low calorific content and converts to a lean form of LNG which few countries are able to use. This being the case, suppliers have admitted they will need to offer major discounts if they hope to sell their large reserves.